Question

* You received no credit for this question in the previous attempt You received no credit for View previous s t Jay Inc. owns 80% of lesia Inc. and uses the cost method to account for its investment. The 2020 income statements of both companies are shown below Tesla ) Gross Profit Miscellaneous $100.000 $30,000 $50.000 $20,000 Revenues Losses Depreciation Expense Income Tax Expense Net Income $20.000 $20,000 30.000 15.000 S6.000 $19.000 On January 1, 2020, Tesla sold equipment to Jay at a profit of $3000. The equiment had a remaining useful life of twenty years on that date Both companies are subject to an effective tax rate of 40% The amount of depreciation expense appearing on Jay's 2020 Consolidated Income Statement would be < Prev 3 of 11 !! Next >

Answer 1

Answer:- $ 34,850 Explanation -- Depreciation Expense_on consolidated income statemerkon $20,000 $15000 Jay (parent) deprecation expense = Tesla (sub) depreciation expense = less, realization of pre-tax profit on intercompany z equipment sale from Tesla to say $3000 (150) 20 years $ 3934850 Consolidated depreciation expenye =X